Economic pessimism climbing: CPA Canada Business Monitor

Pessimism about the national economy over the next 12 months is growing among Canadian business leaders, according to a survey by Chartered Professional Accountants of Canada (CPA Canada).

Toronto, January 30, 2019 – Pessimism about the national economy over the next 12 months is growing among Canadian business leaders, according to a survey by Chartered Professional Accountants of Canada (CPA Canada).

Pessimism soared to 35 per cent among the professional accountants in leadership positions surveyed for the CPA Canada Business Monitor in the fourth quarter of 2018. That is up from 28 per cent in the previous quarter and is significantly higher than a year earlier when pessimism stood at 16 per cent in the final quarter of 2017. Note that these findings came before the Bank of Canada reduced its 2019 GDP growth forecast to 1.7 per cent from 2.1 per cent.

Optimism sits at 26 per cent; its lowest level since 2016 and is down sharply from 48 per cent in Q4 2017. The number of respondents who are neutral about the economy’s prospects sits at 39 per cent.

The top three challenges to the Canadian economy cited by survey participants are protectionist trade sentiment in U.S. (18 per cent); uncertainty surrounding the Canadian economy (15 per cent); and oil prices (12 per cent).

“Despite the recent spate of strong economic data, the sharp deterioration in economic sentiment highlights that Canada’s business leaders are rightly worried about the numerous external risks facing the economy,” says Joy Thomas, president and CEO, CPA Canada.

Company Specific Findings

Company optimism, how the professional accountants surveyed feel about the prospects for their own organizations, dipped in the fourth quarter survey. While running much higher than how survey respondents view the country’s economic outlook, company optimism is down to 49 per cent from 61 per cent a year ago. There are also fewer positive projections around revenues, profits and employee numbers:

  • 64 per cent foresee increased company revenues (72 per cent in Q4 2017)
  • 57 per cent expect increased profits (64 per cent in Q4 2017)
  • 39 per cent expect employee numbers to increase (50 per cent in Q4 2017)

Looking forward, the top priorities cited by survey participants for their own businesses in 2019 are: increasing sales within Canada (21 per cent), reducing costs (16 per cent) and, tied at 13 per cent, attracting/retaining employees and improving productivity.

Business Viewpoints in Advance of 2019 Federal Budget

Almost eight in ten (77 per cent) of those surveyed for the latest CPA Canada Business Monitor think the federal government should use the upcoming budget to set a date for a return to a balanced budget.

More than half of the Canadian business leaders (58 per cent) believe the promised review of Canada’s regulatory system made in the federal government’s Fall Economic Update would be helpful. The government promised to work with stakeholders to deliver a “simpler, clearer and more modern regulatory system” that continues to protect Canadians’ health and safety and the environment.

There is even stronger support among those surveyed for a comprehensive review of Canada’s tax system with almost four in five (79 per cent) of respondents thinking it is required and 66 per cent calling for political parties to make prioritizing that review part of their 2019 federal election campaign platforms.

Among the perceived benefits of a comprehensive review of the tax system:

  • 64 per cent think Canada’s tax system would become less costly and time-consuming for both individuals and businesses;
  • 60 per cent think Canada would attract more investment; and
  • 60 per cent believe it’s a key to enhanced international competitiveness.

“The government took several steps to improve business investment in the Fall Economic Statement, but further actions can still be taken to strengthen Canada competitively and support sustainable economic growth,” says Thomas. “As optimism in the economy softens, Canadian business leaders are looking for a federal fiscal plan that charts a return to budgetary balance and addresses other factors contributing to economic uncertainty.

“Business executives are among the many groups wanting the government to signal its intention to review the country’s tax system; if not the government, then one of the other parties during the coming election.”


The CPA Canada Business Monitor is issued quarterly, based on a survey commissioned by CPA Canada and conducted by Nielsen. The report draws upon business insights of professional accountants in leadership positions in privately and publicly held companies.

For the Q4 2018 study, emailed surveys were completed by 698 of 6,782 people identified by CPA Canada as holding senior positions in industry (CFOs, CEOs, COOs and other leadership roles). The response rate was 13.9% per cent, with a margin of error associated with this type of study ±3.7 per cent, with a confidence level of 95 per cent. Further information regarding response rate calculations can be found in the survey’s background document. The survey was conducted from December 4 to December 21, 2018.

A background document is available online at